Tesla reported Q1 2026 results with EPS of $0.41 versus $0.35 expected, revenue of $22.39B up 15.8% year over year, and automotive gross margin rising to 21.1% from 16.2% due to better mix and lower material costs. Services and Other increased 42% to $3.75B, supported by 1.28M active FSD subscriptions up 51%, and free cash flow more than doubled to $1.44B, while energy storage revenue fell 12%. BYD continued producing record monthly EV and PHEV volumes in China, supported by Blade Battery cells, FinDreams electronics, and a broad model lineup. Tesla introduced affordable financing in China to counter domestic sales dips, indicating pricing pressure from BYD.
"Tesla just posted a Q1 2026 beat with $0.41 EPS versus $0.35 expected, snapping a rough 2025. Revenue hit $22.39B, up 15.8% year over year, and automotive gross margin expanded to 21.1% from 16.2% on better mix and lower material costs. Services and Other jumped 42% to $3.75B, helped by 1.28M active FSD subscriptions, up 51%. Free cash flow more than doubled to $1.44B. That said, Energy storage revenue slipped 12%."
"BYD's story is volume and vertical integration. Blade Battery cells, FinDreams electronics, and a lineup spanning Dolphin, Seal, Han, Tang, and the Yangwang U8 give it a price ladder Tesla simply cannot match in China. Tesla had to introduce affordable financing in China to counter domestic sales dips, a tell that BYD's pricing pressure is biting."
"Tesla is doubling down on autonomy. Unsupervised Robotaxi rides launched in Dallas and Houston, FSD got Supervised approval in the Netherlands, and R&D rose to $1.95B to feed AI5, Dojo 3, and Optimus. CEO Elon Musk is essentially betting Tesla's next leg on inference silicon and humanoid robots alongside its core auto business."
"BYD's bet is industrial. It owns the battery, the power electronics, and increasingly the chips, then ships cars at price points Western OEMs struggle to clear. Where Tesla wants software margin, BYD wants share. Both can work. They just appeal to different patience levels."
Read at 24/7 Wall St.
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